Studio gets permission to film "The Hobbit"

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You know the story of Sam and Frodo but do you know about Frodo's uncle?

The heirs of J.R.R. Tolkien and a movie studio that produced the blockbuster "The Lord of the Rings" trilogy said they settled a lawsuit over the films' profits. Fantasy geeks worldwide rejoiced.

Most importantly for fans of the books and movies, the out-of-court resolution clears the way for a long delayed two-film prequel based on Tolkien's novel "The Hobbit" to finally be released.

Proceeds from the movie will benefit charities around the world, according to a joint press release announcing the settlement.

"We deeply value the contributions of the Tolkien novels to the success of our films and are pleased to have put this litigation behind us," said Alan Horn, president and chief operating officer of Warner Bros. Entertainment Inc.

The two prequels will be directed by Guillermo del Toro, who directed the two "Hellboy" movies and "Pan's Labyrinth."

Tolkien's heirs sued New Line Cinema in February 2008, claiming the studio owed it millions in profits from the movies released between 2001 and 2003. The films earned an estimated $6 billion in sales of movie tickets, DVDs and merchandise.

The lawsuit had sought to rescind New Line Cinema's, which was acquired by Warner Brothers in 2008, rights to make films based on the book.

No settlement paperwork has yet been filed with a Los Angeles court. The terms of the deal are being kept confidential.

Christopher Tolkien, one of the author's trustees, said the lawsuit was regrettable, but the estate is "glad that this dispute has been settled on satisfactory terms that will allow The Tolkien Trust to properly pursue its charitable objectives."

Bonnie Eskenazi, an attorney who handled the lawsuit for the Tolkien estate, said the settlement vindicated the heirs and will touch more than just movie audiences.